High-end clientele including Premier League footballers, wealthy families, and influencers are now buying more lab-grown diamonds, a Dubai-based jeweller revealed to Arabian Business, as natural diamonds continue to lose importance.
When lab-grown diamonds first emerged on the market a few years ago, the diamond industry did not anticipate the consumer profile that would embrace them. Major players like De Beers attempted to steer demand towards specific demographics like teenagers or eco-conscious shoppers through branding exercises.
However, Fergus James, the founder of luxury Dubai-based jeweller Fergus James, says he witnessed demand for lab-grown diamonds surge across all customer profiles following the release of the popular Netflix documentary “Nothing Lasts Forever.”
“What came through very quickly was that it wasn’t what the diamond industry was anticipating in terms of the general demographic or customer profile they anticipated would buy it. It has actually transpired that the customer profile is just completely non-discriminatory. It’s everyone! Even people who’ve got money, they can afford to buy whatever they wanted,” James told Arabian Business.
He recounts selling high-end lab-grown diamond bracelets to wealthy socialites, influencers and Premier League footballers living in multi-million dollar mansions on the prestigious Palm Jumeirah district, as well as cultured diamond jewellery to an ultra-high net worth Indian client who spends over $500,000 annually but carefully selects lab-grown for quality and value.
“They buy nothing but lab,” he revealed.
This shift caught both James and the larger diamond industry off guard.
“We didn’t sit there and say like we’re going to aim to do this. It was like an underlying current. We would just say, well, let’s give people equal information and see which way the river flows. It very clearly just flowed in that direction.”
Within a month of neutrally presenting lab-grown and natural diamond options to customers, James saw demand flip from 5-10 percent to 80-90 percent in favour of cultured gems.
The reason for this dramatic switch, according to James, is that “consumers make choices on buying utility” rather than being swayed by marketing or prestige perceptions. They opt to put excess budget towards other luxury purchases rather than paying a premium for a natural diamond.
The diamond industry ‘completely misunderstood itself’
The diamond industry failed to foresee changes in luxury consumption and made critical missteps in addressing the rise of lab-grown diamonds, he said.
“The diamond industry completely misunderstood itself,” said James.
“Natural diamond sales through Cartier, they’re doing just fine, because they have a brand. Now, what the industry has done, or hasn’t done for the last 30 years is they have not invested anything in the natural diamond brand.” Without cultivating deeper brand meaning or emotion, consumers saw less reason to pay more for a natural stone on intrinsic qualities alone.
By underestimating consumer willingness to choose on value over legacy attributes, natural diamonds now face a more uncertain future. And although nothing is certain, as the value equation improves with lower lab-grown prices, mainstream adoption is likely to accelerate further
Looking ahead, James predicts that lab-grown diamond market share will only continue rising over time against unbranded natural diamonds.
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